Celebrating Foreign Direct Investment

Blog Article
14 Sep 2018

Martin Shanahan, CEO, IDA Ireland

Martin Shanahan, CEO, IDA Ireland

For more than half a century, Ireland has successfully attracted foreign direct investment projects that have made a significant contribution to our economic development. By themselves, multinationals contribute 66 per cent of national exports. But the story is so much richer than that.

Over time, many multinationals have become woven into the fabric of their local communities. Almost 60 per cent of them have been here for over a decade, and one-third of them first established operations more than 20 years ago. Some familiar names have shown a decades-long commitment to the country: IBM first came to Ireland in 1956; Pfizer arrived in the late 1960s, while Apple set up its Cork operation back in 1982.

Moreover, companies like these have consistently reinvented themselves in Ireland, adapting in line with changing industry trends or strategic shifts in focus. The highly skilled, high-value work they carry out in Ireland today bears little resemblance to how they began here. Many of the companies build upon their foundations by expanding their original sites, bringing further investment and creating more jobs. Even as we welcomed 75 new names in the first half of this year, 64 approved investment projects were from existing companies choosing to expand their activities.

It is also fair to say that FDI has delivered benefits to many parts of Ireland. Over recent years, IDA Ireland has pursued a deliberate strategy to further diversify investment locations around the country. Some of the investment projects already announced this year reflect this emphasis; they include Wasdell and WuXi in Co Louth, Quidel in Galway, Deutsche Börse in Cork, Jaguar Land Rover in Shannon, AbbVie and LiveTiles in Sligo, Red Seal Cups in Longford and SkOUT in Portlaoise.

Today, 58 per cent of employees that work in multinationals are based outside Dublin. Between 2015 and 2017, there have been 294 regional investments by FDI companies. These companies spend €2.5 billion annually in capital expenditure outside of Dublin.

From Cork to Sligo and from Shannon to Letterkenny, there are people whose families’ incomes and livelihoods depend directly on multinationals. These companies directly employ 10.2 per cent of Ireland’s labour force. Including indirect employment, the figure rises to over 20 per cent. Many thousands of jobs in Ireland rely on the presence of an anchor employer in a particular location. In 2016, multinationals spent €17.9 billion in the Irish economy on payroll and on Irish-sourced materials and services.

Welcoming multinationals into Ireland has also helped to strengthen our best domestic businesses. For example, when Dan Kiely founded his support services business Voxpro in Cork, global corporations’ sites in Ireland were among his first customers. This early source of business proved vital to growing the company and ultimately led to its successful partnership with TELUS of Canada in 2017. It has been a similar story for many companies providing business support services into the base of multinational operations in Ireland. Countless Irish companies gained invaluable experience from working with best-in-class global corporations. It has helped them to improve their own business processes, while the customers’ internationally recognised brands have also given the Irish companies a vital calling card to expand into overseas markets.

Some of our best-performing indigenous companies are in sectors where FDI activity is strongest, including technology, medtech and pharmaceuticals. This is no accident, and it reflects the knowledge and experience that founders and startups gained from working with, or for, the Irish operations of a global company.

These examples sum up what we think of as the ‘multinational multiplier effect’. This is the many downstream benefits to Ireland from an FDI project. Every time a company decides to invest in Ireland, the effects become amplified because it supports further employment and helps to sustain local businesses and communities. It is worth noting that, less than a decade ago when Ireland struggled during the downturn, the FDI sector showed enormous commitment to this country and this made a huge contribution to our subsequent economic recovery.

The inaugural Invest in Ireland awards will reflect the success of the FDI sector and its role in Ireland. The ten chosen award categories reflect the breadth of activity among multinationals across many industry sectors and locations throughout the country. This includes: use of R&D; sourcing in Ireland; organisational transformation; collaboration between public and private sector; excellence in regional investment; staff upskilling; commitment to diversity; corporate social responsibility; and emerging business. An independent panel of judges will determine the winners in each category. There is also an award for investment of the year, and the event will also honour an ‘FDI hero’ with a lifetime achievement award.

All multinational companies with manufacturing or services operations in the Republic of Ireland are eligible to enter. The closing date/time for nominations is 27 September at 4pm. The awards will be presented at a gala ceremony taking place at the Round Room of the Mansion House on Thursday 18 October.

I encourage all eligible companies to celebrate their involvement in Ireland by entering nominations Visit www.investinirelandawards.ie to find out more, and I look forward to welcoming you at the Mansion House next month.

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